S&P 500 Wave 2 Finishes Monday or Tuesday! Then a CRASH Starts!
THE FINAL COUNTDOWN TO THE CRASH!
The CRASH that is coming in July and August is going to catch both bulls and bears off guard and be a shock to the unsuspecting public. Complacency reigns supreme right now. The bulls have gone wild and no longer believe that prices can drop. This is what happens during bear market rallies.
I expect the counter trend rally to finish by Monday or Tuesday and complete wave 2. I do expect Monday to be a strong up day with the gap filling on a closing basis, close above 3200 and set up a lower high on SPX to complete a wave 2 counter trend rally. The conclusion of the wave 2, will start a wave 3 CRASH move in the stock market as we officially kick off earning season. The wave 3 will be a 5 wave push lower, likely forming a larger ABC pattern. The first leg A was 1202 points. That means the next selloff of leg C down should go to a least 2031. That would take out the March low.
Catalyst for the selloff could be:
Q2 earning season which is expected to a big decline. S&P earnings are expected to decline by -44.1 % and revenue by 10.9 % in Q2 , Covid-19 cases trending higher, a stronger dollar, election uncertainty, stimulus effect wearing off, delay in addition stimulus by congress, continued US-China trade tensions and an extremely ugly Q2 GDP number at the end of July.
I expect that the C leg, that has likely already begun to be at least 1202 points and probably more. I still believe that the June 8th high will hold and that a lower high will form early next week on either Monday or Tuesday. The S&P 500 does have distortions as 15 stocks basically control nearly 35 % the index. You don't have those distortions with the New York Composite (NYA) which includes everything on the New York Stock Exchange. So even if I'm wrong and SPX moves a little bit higher than the June 8th peak, the NYA isn't going to push above its June 8th high. It is behaving as it should in this bear market. Meanwhile, the S&P 500 has had distortions due to it's heavy tech influence. Bear market rallies look like new bull markets, but they are not. This is a bear market rally. Additionally, the Nasdaq 100 is near a peak as well and will likely start a crash move at some point in the next or two. I will be posting a video about this count and the coming CRASH this weekend, which is going to posted at the chart pattern trader dot com, either on Saturday or Sunday.
Lastly, another indicator I use that has been very accurate, has the S&P 500 forming a major top and sell signal by Monday's close. This is in agreement with this EW count.
The CRASH that is coming in July and August is going to catch both bulls and bears off guard and be a shock to the unsuspecting public. Complacency reigns supreme right now. The bulls have gone wild and no longer believe that prices can drop. This is what happens during bear market rallies.
I expect the counter trend rally to finish by Monday or Tuesday and complete wave 2. I do expect Monday to be a strong up day with the gap filling on a closing basis, close above 3200 and set up a lower high on SPX to complete a wave 2 counter trend rally. The conclusion of the wave 2, will start a wave 3 CRASH move in the stock market as we officially kick off earning season. The wave 3 will be a 5 wave push lower, likely forming a larger ABC pattern. The first leg A was 1202 points. That means the next selloff of leg C down should go to a least 2031. That would take out the March low.
Catalyst for the selloff could be:
Q2 earning season which is expected to a big decline. S&P earnings are expected to decline by -44.1 % and revenue by 10.9 % in Q2 , Covid-19 cases trending higher, a stronger dollar, election uncertainty, stimulus effect wearing off, delay in addition stimulus by congress, continued US-China trade tensions and an extremely ugly Q2 GDP number at the end of July.
I expect that the C leg, that has likely already begun to be at least 1202 points and probably more. I still believe that the June 8th high will hold and that a lower high will form early next week on either Monday or Tuesday. The S&P 500 does have distortions as 15 stocks basically control nearly 35 % the index. You don't have those distortions with the New York Composite (NYA) which includes everything on the New York Stock Exchange. So even if I'm wrong and SPX moves a little bit higher than the June 8th peak, the NYA isn't going to push above its June 8th high. It is behaving as it should in this bear market. Meanwhile, the S&P 500 has had distortions due to it's heavy tech influence. Bear market rallies look like new bull markets, but they are not. This is a bear market rally. Additionally, the Nasdaq 100 is near a peak as well and will likely start a crash move at some point in the next or two. I will be posting a video about this count and the coming CRASH this weekend, which is going to posted at the chart pattern trader dot com, either on Saturday or Sunday.
Lastly, another indicator I use that has been very accurate, has the S&P 500 forming a major top and sell signal by Monday's close. This is in agreement with this EW count.